Deal keeps US healthcare reform on track

Deal keeps US healthcare reform on track
By Edward Luce in Washington
Copyright The Financial Times Limited 2009
Published: July 31 2009 23:29 | Last updated: July 31 2009 23:29
http://www.ft.com/cms/s/0/5e1e204e-7e20-11de-8f8d-00144feabdc0.html


Liberal and conservative Democrats on Friday pulled off a last-minute compromise on healthcare that will enable them to go into the summer congressional recess with the reform process still on track.

Friday’s deal paves the way for a full House of Representatives vote in September. The bill, which would cost about $1,000bn over 10 years, would extend insurance to most of the almost 50m Americans currently lacking it, funded through savings within the healthcare system.

Under the compromise, Medicare, the government programme for the elderly, would negotiate lower drugs costs directly with drugs companies and the savings would help to pay for a generous employer exemption, which conservative Democrats negotiated for small businesses. That exemption, which was doubled to companies with revenues of up to $500,000 earlier this week, would have been funded by a cut in subsidies for poorer Americans.

However, key elements of the final bill, including whether to establish a strong public insurance option that would compete with the private plans, have yet to be thrashed out. “This is one step in a long and complex legislative process,” said Zack Space, a centrist Democrat from Ohio.

Friday’s deal was brokered by Henry Waxman, chairman of the House energy and commerce committee, who spent two weeks trying to bridge the wide philosophical differences between conservative “blue dog” Democrats and their liberal colleagues.

However, a similar compromise continues to elude the Senate, which is a much tougher hurdle for Barack Obama’s administration given that Democrats will need 60 out of the 100 votes in the upper chamber to prevent the Republicans from filibustering it.

Bills in the House can pass by a simple majority. The Senate maths is complicated by the absence of Ted Kennedy, the chairman of the Senate health committee, who is undergoing treatment for brain cancer. Friday, Chris Dodd, the senator for Connecticut, who is standing in for Mr Kennedy, announced he was in the early stages of prostate cancer. “I’m going to be fine,” he said. “It’s not about me. It’s about the 14,000 Americans who lose their healthcare every day.”

On Thursday, Max Baucus, chairman of the pivotal Senate finance committee, said he would be unable to broker a bipartisan compromise before the August break. He set a new deadline of September 15. Opponents hope the delays will give them a chance to weaken the whole reform effort.

“President Obama has got to use the next five weeks to get a majority of Americans back in favour of reform,” said Tom Gallagher, a veteran Congress-watcher. “If he can’t do that, then he may be in for a disappointing Fall [autumn].”